Family Equity

Use a family equity home loan to reduce borrowing costs

Family equity home loans can be a huge benefit in securing a quality home loan by substantially reducing setup costs and removing the need for a cash deposit.

Mortgage insurance not required if using a family equity home loan saving you 1000’s of dollars vs a standard 100 percent loan. You can still borrow 100% of the purchase price using family equity home loans. In fact some lenders will also allow you to consolidate other debts and costs into the family equity home loan and borrow more than 100% of your purchase price

Family could include Mother, Father, Brother, Sister and some lenders will also consider Son, Daughter, Uncle, Aunty or Grandparents.


Take me to the family equity loan qualification....

Some family equity home loan facts:

  • A family equity mortgage replaces the need for a cash deposit.
  • There is no mortgage insurance payable on family equity loans
  • Your first home owner’s grant will not be compromised by using a family equity loan
  • Family can provide a guarantee limited to only part of the equity in their property
  • The family property can be released from the family equity mortgage once there is sufficient equity available
  • Family income can be used to assist borrowing capacity

First home buyer family equity loan based on a 350,000 purchase price

Purchase price of new property
350,000
Value of family property
450,000
Total security value
800,000

The 350,000 is used to cover the purchase price. $7000 first home owner’s grant is used to cover costs. Lets say some debt consolidation comes to 20,000 (eg payout credit cards and personal loan). Total loan amount required would be 370,000. The overall percentage borrowed in this example is around 46%.